Good Strategic HR Discussions? Or Just Dead Ends?

Back in 2005, Fast Company magazine published the now famous (or infamous depending on your perspective) article entitled “Why We Hate HR.” The basic premise was that HR professionals are good at transactional “administrivia” like pay, benefits and retirement (all functions that are being outsourced) but lack the skills (or interest) necessary to play a more strategic role in managing talent. Since then, thousands of articles, presentations, webinars, conferences and the like have advised HR professionals on what they need to do to “get a seat at the [executive] table.” Most advice, while good, follows a few key themes and in my opinion either distracts our attention or confuses us.

Theme 1: To get a seat at the table, you must talk the language of business. If you want to be taken seriously you must understand financial statements, gross margin, EBITDA, return on investment, depreciation, cash flow, retained earnings, etc. These terms are important, and I agree that HR professionals need to improve their business acumen, but just because you can explain how to play the game doesn’t mean you will be able to play the game or even be put in the game for that matter.

Theme 2: To get a seat at the table, you must align HR Strategy with business strategy and overall think and talk more strategically. Ever sit through a presentation on HR strategy? I’m an educated man, but frankly, I don’t understand half of what they’re talking about. I hear a bunch of words like synergy, value added, key performance indicators, knowledge base, alignment, etc. and of course a bunch of fancy charts and diagrams. In the Fast Company article Keith Hammonds describes an HR strategy presentation he sat through: “There is mention of ‘internal action learning’ and ‘being more planful [sic]in my approach.’ PowerPoint slides outline [the company’s] initiatives in performance management, organization design, and horizontal-solutions teams. [The presenter] describes leveraging internal resources and involving external resources — and she leaves her audience dazed. That evening, even the human-resources pros confide they didn’t understand much of it, either.” Strategy is very important, but we’ve overcomplicated it and we spend way too much time trying to describe what “IT” is and how we need more of “IT.” People in the real world don’t have time for that.

Theme 3: To get a seat at the table, you must become certified and the more initials the better. PHR, SPHR, GPHR, CEBS, CCP, MBA, etc. Isn’t it funny how some of the most successful people in the United States never graduated from college? People like Bill Gates, Michael Dell, Steve Jobs, Larry Ellison and Richard Branson to name a few (I know a few of them later earned honorary degrees – but you get the point). Don’t get me wrong, I’m a big fan of higher education and have a few initials myself (MBA, SPHR), heck, we even have a highly successful HR certification prep course here at CAI, but that alone will not help you get, or keep, a seat at the table or to become more strategic.

Theme 4: To get a seat at the table, you must implement HR Metrics. To get a seat at the table, you must develop a robust HR scorecard and track those key performance indicators that result in HR success. Turnover, absenteeism, time to hire, cost to hire, HR as a percentage of payroll, etc. While I’m a big fan of numbers (thanks to my mom the accountant) and I firmly believe what gets measured gets done, developing really good and relevant HR metrics is hard and tracking them even harder. I’m not saying you shouldn’t develop them, just don’t start here.

Theme 5: Forget it, you’re not getting a seat at the table so complain about it – blame the company. I hear a lot of HR professionals complain about their companies, their management teams, the CEO, etc. “I would love to be more strategic but my company just doesn’t understand the value of HR” or, “We don’t have the money to spend on training, day cares, health care centers and the like.” So basically, it’s the company’s fault you’re not more strategic. Fortunately, there are plenty of HR support groups out there to help you refine and develop your own sad story if you are so inclined.

Ok, so with all the books, articles, presentations, consultants, etc. out there telling HR professionals how to be more strategic, how to get a seat at the table, and how to be a key business partner, why is it that many still aren’t? I’ll address that in my next post.

One Response to “Good Strategic HR Discussions? Or Just Dead Ends?”

I couldn’t agree more. We have found that strategy in regards to an employee benefit plan has got to be practical and direct. Critical components are a sense of where you are, where you want to go (this needs to be in alignment with overall strategy of where the company is going) and what steps you can commit to head in that direction. The simpler and more direct the plan is, the more likely it is to actually get executed. What is the old saying, “vision without execution, is merely a hallucination”. To make this practical approach most effective, make sure you look at many perspectives on where you are currently. Often the most accurate viewpoint is only found after examining a couple of angles.

There is one other critical piece, know when to abandon the plan and start over. Without a clear understand of what your escape hatch looks like you may leave the plan to early or remain too long.

I think this planning method that we use for employee benefit plans can be applied to most any application in business.

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